Cement major Vicem sees 14% drop in H1 profit

Vietnam National Cement Corporation (Vicem), the country's biggest cement producer, reported a pre-tax profit of VND1,108 billion ($47.26 million) in the first six months of the year, down 14% year-on-year.

The state-run company's revenue reached VND19,219 billion ($819 million), a 14.4% rise year-on-year, according to its financial report.

Vicem's total cement production and sales hit 14.12 million tons in the period, down 4.4%. Of the figure, sales reached 12.78 million tons, up 8%. Cement and clinker exports achieved 1.68 million tons, a 14% decrease.

Vicem said economic turbulences in the country and the world had directly affected the production and business of cement companies. The price of gasoline, oil and coal continued to rise, with imported coal prices surging to $490 per ton amid scarce supply, eight times higher than those in late 2020.

In addition, the corporation faced difficulties in export of clinker and cement. Production and sales through Vicem's export channels decreased by nearly 20% compared to the first six months of last year.

Facing the cost burden, Vicem units like Vicem Ha Tien, Vicem But Son, Vicem Hoang Mai, Vicem Bim Son, Vicem Hoang Thach, and Vicem Hai Van increased the price of cement in March, May and June by VND50,000-100,000 ($2.13-4.27) per ton each time.

Amid difficult coal sourcing conditions, Vicem units studied the use of low-grade coal to keep furnaces burning. This fuel affects productivity and causes heat loss but helped clinker kilns maintain continuous operation.

Besides, the units also burned waste and sludge as fuel and alternative raw materials. In the first half, the amount of waste used at four Vicem units reached nearly 92,000 tons, and the amount of sludge, nearly 49,800 tons.

In 2022, Vicem aims to generate a revenue of over VND37,000 billion ($1.58 billion), up 10% compared to 2021.